United Parcel Service, Inc. · NYSE:UPS
United Parcel Service — Corporate Update (April 2016)
10 slides from United Parcel Service's corporate update, Apr 28, 2016
Slide 1: Central States Pension Fund Overview
April 28, 2016 Central States Pension Fund* Overview *Central States Southeast and Southwest Areas Pension Fund
Slide 2: Safe Harbor
2 Safe Harbor Except for historical information contained herein, the statements made in this presentation constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are subj
Slide 3: Agenda
3 Investor Relations Update • UPS Retirement Plan Overview • Central States Pension Fund (CSPF) Timeline • CSPF Proposed Benefit Reduction Plan • Potential Outcome of Treasury Decision • Summary Agenda
Slide 4: UPS Retirement Plans – U.S. Overview
4 • Majority of participants in well-funded plans • 76% Union plans • 39% in UPS Pension Plan • Union Part-time & UPS Freight • 24% in Multiemployer Pension Plans (MEPP) • 13% UPS/IBT(1) Jointly Managed Plan • Certain employees formerly covered by the Central States Pension Fund UPS Retirement Plans
Slide 5: Fund Timeline
5 • Withdrawal from CSPF negotiated in IBT Master Agreement • New jointly trusteed plan created – UPS/IBT Plan • $6.1B payment to Central States – to exit, limiting future liability • $1.7B liability to restore lost benefits • Agreement included Backstop provision • If legally permitted to reduce be
Slide 6: CSPF and New Law Timeline
6 • New Multiemployer Pension Reform Act (MPRA) in December 2014 • MPRA allowed for earned benefit reductions for the first time • CSPF projects insolvency by 2025 • CSPF files under MPRA in September 2015 • UPS opposed plan with comment letters and testimony • Treasury reviewing benefit reduction a
Slide 7: CSPF Proposed Benefit Reduction Plan
7 • MPRA imposed a tiered benefit reduction process • Benefit reductions permitted only to the extent required to avoid insolvency • Only Tier III employees are covered by UPS backstop provision • UPS firmly believes benefit reduction plan does not comply with the law CSPF Proposed Benefit Reduction
Slide 8: Potential Outcome of Treasury Decision
8 • If rejected, CSPF benefit payments will not be reduced without further action • If approved without delay, based on information currently available: • Membership vote required – Treasury could override a vote to reject • Approval could trigger backstop provision from 2007 Agreement • Results in
Slide 9: Summary
9 • Decision is expected on or before May 7th 2016 • New MPRA law allows for benefit reduction proposals for first time • UPS firmly believes CSPF proposal does not comply with MPRA • CSPF proposal disproportionately impacts Tier III participants • Backstop provision applies only to CSPF Tier III –
Slide 10: UPS Investor Relations Website
UPS Investor Relations Website: www.investors.ups.com
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